Cheque collection charges including Speed Clearing Charges should not be levied if the collecting bank and the paying bank are located within the jurisdiction of the same CTS grid even though they are located in different cities. In CTS, the presenting bank or its branch captures the data on the MICR band and the images of a cheque using their Capture System comprising of a scanner, core banking or other application which is internal to them, and have to meet the specifications and standards prescribed for data and images.
As part of the requirement, the collecting bank presenting bank sends the data and captured images duly signed digitally and encrypted to the central processing location Clearing House for onward transmission to the paying bank destination or drawee bank. The Clearing House processes the data, arrives at the settlement figure and routes the images and requisite data to the paying banks. This is called the presentation clearing. The paying banks through their CHIs receive the images and data from the Clearing House for payment processing.
The clearing cycle is treated as complete once the presentation clearing and the associated return clearing sessions are successfully processed. The entire essence of CTS technology lies in the use of images of cheques instead of the physical cheques for payment processing.
There is no major change in the clearing process for customers. Customers continue to use cheques as at present, except to ensure the use of image-friendly-coloured-inks while writing the cheques.
Of course, such of those customers, who are used to receiving the paid instruments like government departments would also receive the cheque images.
Cheques with alterations in material fields explained in detail later are not allowed to be processed under the CTS environment. The benefits are many. With the introduction of imaging and truncation, the physical movement of instruments is stopped. The electronic movement of images can facilitate reduction in the clearing cycles as well. Moreover, there is no fear of loss of instruments in transit. Further, limitations of the existing clearing system in terms of geography or jurisdiction can be removed, thus enabling consolidation and integration of multiple clearing locations managed by different banks with varying service levels into a nation-wide standard clearing system with uniform processes and practices.
CTS also benefits issuers of cheques. The Corporates if needed can be provided with images of cheques by their bankers for internal requirements, if any. CTS thus brings elegance to the entire activity of cheque processing and clearing. The benefits from CTS could be summarized as follows —. Grid based CTS provides significant cost savings. Banks will benefit from economies of scale as the grid CTS obviates the need for establishing inward cheque processing infrastructure at various clearing locations.
With the merger of many local clearing houses with CTS grids, the settlements which were earlier spread across numerous clearing house locations have been subsumed into a single settlement, thereby significantly reducing the liquidity requirements for the banks. CTS will also result in other benefits in terms of reduction in the cheque processing fee, reduction in operational overhead, elimination of clearing differences and reconciliation issues etc.
If a customer desires to see the physical cheque issued by him for any reason, what are the options available? Under CTS the physical cheques are retained at the presenting bank and do not move to the paying banks. To meet legal requirements, the presenting banks which truncate the cheques need to preserve the physical instruments for a period of 10 years.
How would be the uniqueness of a physical cheque be captured and imparted to the cheque image? CTS in India mandates the use of prescribed image specifications only. Images that do not meet the specifications are rejected. As the payments are made on the basis of the images, it is essential to ensure the quality of the images. The facility can be provided only on well conducted, KYC compliant accounts as mentioned in paragraph. Cheque Collection Policy. The facility can be provided only on well conducted, KYC compliant accounts as mentioned in paragraph 2.
Start From. Upto 1 lakh w. Above 1 lakh w. Ask Sia. Was this helpful? Ultimately you can refer a dispute to the Financial Ombudsman Service. The vast majority of cheques are paid and do not bounce. Only around 0. The typical reason for a bank to bounce a cheque is because a customer does not have enough money in their account to pay the cheque or they have used all of their overdraft facility. In addition, when a bank spots a fraudulent cheque it will bounce it.
But banks also bounce cheques because: the cheques have not been signed correctly e. A cheque is valid for as long as the debt between the two parties i. However, it is common banking practice to reject cheques that are over six months old to protect the person who has written the cheque, in case the payment has been made another way or the cheque has been lost or stolen.
This six-month timeframe is at the discretion of individual banks. It should not be assumed that cheques older than six months would automatically be rejected as the only definite way to cancel a cheque is for the person who wrote it to request that a stop be placed on it.
If you have a cheque that you want to pay in that is more than six months old, your best course of action is to not pay it in and instead obtain a replacement from the person who gave it to you. Where there is a dispute, a cheque remains legally valid in order to provide proof of the existence of a debt for a period of six years, which is the Statute of Limitations. You have a legal right to stop a cheque before the cheque has been paid Bills of Exchange Act However, there is be significantly less time to do this with cheque imaging as the clearing timescales are much quicker and the recipient might pay in the cheque via a mobile banking app.
If they do, it means that the clearing process will begin sooner than if the cheque recipient has to visit a bank branch to pay it in. There are also limited circumstances in which stopping a cheque is permissible, as has always been the case.
You should talk to your bank or building society first.
0コメント